Should you be using the new Bitcoin ATM? They might be coming soon to a location near you.
Published in on November 5, 2013
“Bitcoin could go to millions of dollars” – Jeff Berwick, TheDollarVigilante.com
The first Bitcoin ATM just opened in Vancouver’s central downtown district in a Waves Coffee causing quite a stir nationally and beyond. According to ABC News, in last week alone more than $10,000 was discharged from Bitcoin to dollars with individual transactions totaling or exceeding 81.
Why Vancouver of all places and not a major US metropolis? Bitcoin ATMS were nearly brought to the continental US earlier this year. Jeff Berwick, entrepreneur and financial commentator from TheDollarVigilante.com recently planned to bring a Bitcoin ATM to the United States (see my interview in May here). Although he remains a big supporter of Bitcoin, he ended up abandoning plans to bring the first ATM to the US due to cumbersome regulation and cost prohibitive set up expenses. After hiring lawyers, he was informed that his new venture would fall under four different US regulators: banking, finance, securities and even communications as they would be using the internet to operate the ATMs. In the end, they would have needed to pay $25 million just to get insurance bonds to be a money Transmitter.
In Canada, FINRA has recently come around after an initially wary approach, allowing the group Bitcoiniacs to successfully bring the ATM to Vancouver. Users of the machine can either exchange cash for Bitcoins, or turn the digital units into dollars. Bitcoin is wholly unregulated by governments, and trades on an open market that operates much like a stock market. According to Bitcoinacs, “Our Bitcoin ATM is revolutionizing the way people buy and sell Bitcoins. We teamed up with Robocoin to install the world's first Bitcoin ATM, here in Vancouver, BC, and we plan to install four more ATMs across Canada in the coming months.” (Source: Bitcoiniacs)
First time users can create an instant account through the ATM which uses a palm scanner for identification purposes. I signed up for an account in about 10 minutes by scanning my palm a sequence of times, writing in my email address , which took 3-4 minutes and then receiving approval via email which came about 5 minutes later. Once I scanned my hand again at the machine, I was validated to purchase or sell Bitcoins. It was very simple and fast, compared with the more time consuming process of appointments and paperwork required to setting up a bank account. Once you are in the Bitcoin system, you have a digital wallet assigned to you and can now conduct your transactions (see image).
More and more businesses have been accepting Bitcoin as payment, including a local fitness studio, a landscaping company, two tech firms including a 3-D printing firm, and several restaurants and a coffee house in addition to Waves Coffee. It appears that China has interest in Bitcoin as Baidu, the massive Chinese search engine signed with Bitcoin in the past month. (Source: Mashables) With a growing popularity and high profile backers like Berwick, it shows no signs of slowing down in adaption.
The ATM charges a 3% fee to the user. I asked Berwick what his thoughts were on the newest Bitcoin ATM to hit Vancouver, and if he would use the machine. “Yes, I think it is excellent. I don't know much about the machines themselves but I applaud any effort to get Bitcoin more out into the public. I unfortunately failed with my own attempt but am glad someone has done it. As for using the ATMs myself, I may or may not... but I am glad they exist. I mostly receive Bitcoin in return for services so if I can take out fiat cash from my Bitcoin at locations I'd be very happy to do so.”
As for current involvement and future valuations, Jeff commented: “I'm definitely involved in terms that I love it… I believe if Bitcoin continues to have an uptake with the population and continues to be used as a currency it could go to - and I don’t mean to talk about crazy numbers here – but we're talking millions dollars a per Bitcoin.”
As for himself, he stated he will not be doing business again in the US, but would look into other locations with less regulation, preferably outside western nations. With my latest interview with Jeff in Spokane (here), he discussed using Bitcoin as an alternative to having Gold and Silver in your portfolio for wealth preservation. The upside to the digital currency is that nobody can physically steal Bitcoin from you the same way physical bullion can be stolen. They are password protected and there is encryption involved. When I asked him about the downside risks, he mentioned that the biggest risk would be a blackout or shutdown of the internet. From a diversification standpoint, he champions the concept that Bitcoins offer an alternative safe haven for wealth preservation along with gold and other precious metals to state-backed units of currency.
Recent connections to drug use and money laundering through a black market site Silk Road which was shut down in October, have hurt the new currency’s image. Despite this, Circle Internet Financial this week announced a $9 M financing from a consortium including Jim Breyer, Accel Partners and General Catalyst Partners. Circle Internet is going to be providing methods for merchants to buy, sell and keep Bitcoins. Their service will compete with currently running BitPay and Coinbase. The Bitcoin has been recognized as having undergone a ‘changing of the guard’ from small groups of Bitcoin fans to major businesses and business people who are recognizing the payment system in a legitimate way. As mentioned by Berwick, for Bitcoin to operate all across the US, it would require 47 money transmitter licenses and major funding and regulatory barriers. Despite this, Jim Breyer or Circle told the New York Times “I’m confident that you will see major worldwide retailers adopting systems built on Bitcoin. Breyer was an early investor in Facebook ($FB). According to the article, the Silicon Valley crowd perceives Bitcoin as having similar promise as social networks have been. (New York Times)
I approached Nick Wadell, founder and senior editor of the Cantech Letter and co-creator of the upcoming Cantech Investment Conference coming to Toronto early next year, and asked him to opine on what this means for the Canadian tech landscape to which he stated that it was the “latest in a series” of tech related headlines including Ted Talks, Amazon and Facebook opening offices in Vancouver. His view is that Bitcoin will stand the test of time; however it will “become co-opted by newer versions of digital currency.” As for its applications- “I would recommend using it for transactions because it's clearly an advanced offering.” When commenting on Bitcoin as a currency, Nick stated that he has mixed feelings. “Bitcoin is essentially a virtual version of gold in that it is decentralized and [has] limited availability. As a way to make payments it is the evolution of technology it is advanced and is an important phenomenon.”
Would he invest in Bitcoin as a speculative tech investment? Nick’s take: “Run for the hills...”
Vanessa Collette is the host of GoldSeek TV and anchor for Cambridge House Live. She conducts regular interviews with experts on finance related topics with a focus on investing.
Follow Vanessa on Twitter: @vavicolletteTV
The first Bitcoin ATM just opened in Vancouver’s central downtown district in a Waves Coffee causing quite a stir nationally and beyond. According to ABC News, in last week alone more than $10,000 was discharged from Bitcoin to dollars with individual transactions totaling or exceeding 81.Why Vancouver of all places and not a major US metropolis? Bitcoin ATMS were nearly brought to the continental US earlier this year. Jeff Berwick, entrepreneur and financial commentator from TheDollarVigilante.com recently planned to bring a Bitcoin ATM to the United States (see my interview in May here). Although he remains a big supporter of Bitcoin, he ended up abandoning plans to bring the first ATM to the US due to cumbersome regulation and cost prohibitive set up expenses. After hiring lawyers, he was informed that his new venture would fall under four different US regulators: banking, finance, securities and even communications as they would be using the internet to operate the ATMs. In the end, they would have needed to pay $25 million just to get insurance bonds to be a money Transmitter.
In Canada, FINRA has recently come around after an initially wary approach, allowing the group Bitcoiniacs to successfully bring the ATM to Vancouver. Users of the machine can either exchange cash for Bitcoins, or turn the digital units into dollars. Bitcoin is wholly unregulated by governments, and trades on an open market that operates much like a stock market. According to Bitcoinacs, “Our Bitcoin ATM is revolutionizing the way people buy and sell Bitcoins. We teamed up with Robocoin to install the world's first Bitcoin ATM, here in Vancouver, BC, and we plan to install four more ATMs across Canada in the coming months.” (Source: Bitcoiniacs)
First time users can create an instant account through the ATM which uses a palm scanner for identification purposes. I signed up for an account in about 10 minutes by scanning my palm a sequence of times, writing in my email address , which took 3-4 minutes and then receiving approval via email which came about 5 minutes later. Once I scanned my hand again at the machine, I was validated to purchase or sell Bitcoins. It was very simple and fast, compared with the more time consuming process of appointments and paperwork required to setting up a bank account. Once you are in the Bitcoin system, you have a digital wallet assigned to you and can now conduct your transactions (see image).
More and more businesses have been accepting Bitcoin as payment, including a local fitness studio, a landscaping company, two tech firms including a 3-D printing firm, and several restaurants and a coffee house in addition to Waves Coffee. It appears that China has interest in Bitcoin as Baidu, the massive Chinese search engine signed with Bitcoin in the past month. (Source: Mashables) With a growing popularity and high profile backers like Berwick, it shows no signs of slowing down in adaption.
The ATM charges a 3% fee to the user. I asked Berwick what his thoughts were on the newest Bitcoin ATM to hit Vancouver, and if he would use the machine. “Yes, I think it is excellent. I don't know much about the machines themselves but I applaud any effort to get Bitcoin more out into the public. I unfortunately failed with my own attempt but am glad someone has done it. As for using the ATMs myself, I may or may not... but I am glad they exist. I mostly receive Bitcoin in return for services so if I can take out fiat cash from my Bitcoin at locations I'd be very happy to do so.”
As for current involvement and future valuations, Jeff commented: “I'm definitely involved in terms that I love it… I believe if Bitcoin continues to have an uptake with the population and continues to be used as a currency it could go to - and I don’t mean to talk about crazy numbers here – but we're talking millions dollars a per Bitcoin.”
As for himself, he stated he will not be doing business again in the US, but would look into other locations with less regulation, preferably outside western nations. With my latest interview with Jeff in Spokane (here), he discussed using Bitcoin as an alternative to having Gold and Silver in your portfolio for wealth preservation. The upside to the digital currency is that nobody can physically steal Bitcoin from you the same way physical bullion can be stolen. They are password protected and there is encryption involved. When I asked him about the downside risks, he mentioned that the biggest risk would be a blackout or shutdown of the internet. From a diversification standpoint, he champions the concept that Bitcoins offer an alternative safe haven for wealth preservation along with gold and other precious metals to state-backed units of currency.
Recent connections to drug use and money laundering through a black market site Silk Road which was shut down in October, have hurt the new currency’s image. Despite this, Circle Internet Financial this week announced a $9 M financing from a consortium including Jim Breyer, Accel Partners and General Catalyst Partners. Circle Internet is going to be providing methods for merchants to buy, sell and keep Bitcoins. Their service will compete with currently running BitPay and Coinbase. The Bitcoin has been recognized as having undergone a ‘changing of the guard’ from small groups of Bitcoin fans to major businesses and business people who are recognizing the payment system in a legitimate way. As mentioned by Berwick, for Bitcoin to operate all across the US, it would require 47 money transmitter licenses and major funding and regulatory barriers. Despite this, Jim Breyer or Circle told the New York Times “I’m confident that you will see major worldwide retailers adopting systems built on Bitcoin. Breyer was an early investor in Facebook ($FB). According to the article, the Silicon Valley crowd perceives Bitcoin as having similar promise as social networks have been. (New York Times)
I approached Nick Wadell, founder and senior editor of the Cantech Letter and co-creator of the upcoming Cantech Investment Conference coming to Toronto early next year, and asked him to opine on what this means for the Canadian tech landscape to which he stated that it was the “latest in a series” of tech related headlines including Ted Talks, Amazon and Facebook opening offices in Vancouver. His view is that Bitcoin will stand the test of time; however it will “become co-opted by newer versions of digital currency.” As for its applications- “I would recommend using it for transactions because it's clearly an advanced offering.” When commenting on Bitcoin as a currency, Nick stated that he has mixed feelings. “Bitcoin is essentially a virtual version of gold in that it is decentralized and [has] limited availability. As a way to make payments it is the evolution of technology it is advanced and is an important phenomenon.”
Would he invest in Bitcoin as a speculative tech investment? Nick’s take: “Run for the hills...”
Vanessa Collette is the host of GoldSeek TV and anchor for Cambridge House Live. She conducts regular interviews with experts on finance related topics with a focus on investing.
Follow Vanessa on Twitter: @vavicolletteTV
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